Credit rating of railway bonds to remain intact
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E-mail Xinhua, March 13, 2013
A senior central bank official said Wednesday that the credit rating of the bonds issued by the Ministry of Railways (MOR) will remain intact after the ministry's restructuring.
China plans to dismantle the MOR into administrative and commercial arms to reduce bureaucracy and improve railway service efficiency. The hefty debts of the ministry arouse worries of defaulting.
After the restructuring, the commercial loans borrowed by the ministry will be transferred to the proposed China railway corporation, which will carry out the existing ministry's commercial functions, Liu Shiyu, deputy governor of the People's Bank of China (PBOC), said at a press conference on the sidelines of the parliament's annual session.
The country's banks will continue to extend financial support to railway investment and will work out more comprehensive measures to support railway construction and investment, he added.
According to official data, the ministry's debt-to-asset ratio climbed to 61.81 percent at the end of September 2012. Its total assets amounted to 4.3 trillion yuan (684.7 billion U.S. dollars), and its debts amounted to 2.66 trillion yuan at that time.
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